Arthur Hayes warns Bitcoin could nuke to low $80Ks before bottoming

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Bitcoin (BTC) began the week under pressure as it extended a month-long slump. It has pushed the market toward its weakest stretch since 2022. After posting a brief weekend bounce, BTC slipped again under $86,000 before recovering slightly. However, it is still trading 30% below the record highs set in early October.

Amid this erupting situation, one of crypto’s more influential macro watchers, Arthur Hayes, dropped some of his viewpoints. He isn’t expecting immediate relief. In a post, Hayes said liquidity conditions have shown only “minor improvement,” though he flagged two developments worth watching. He highlighted that the US banks increased lending in November, and the Federal Reserve is widely expected to halt quantitative tightening on Dec. 1.

Arthur Hayes sees BTC dipping

Despite this, he sees Bitcoin spending the near term chopping below $90,000. He guesses that BTC might dip into the low $80,000s, but believes that the $80K zone will ultimately hold. Bitcoin price has dropped by around 21% over the last 30 days.

Hayes was blunt in his broader view of the cycle. He argued that credit conditions matter more than the Fed’s benchmark rate itself. “We could hit ATH with Fed funds at 10% if the Fed did unlimited QE at the same time,” he wrote.

He also looked into the HYPE’s much-anticipated comeback. Hayes stated that simple maths can show the only way HYPE can overcome the uncertainty and that is massively growing revenue. He mentioned that even if the HYPE team pinky swears not to sell, nothing is holding them to that. He added that this implies a 0% amount of daily pressure. Its price has dipped by more than 25% over the past 30 days. HYPE is trading around $32 at the press time.

Extreme fear still dominates

The cumulative crypto market cap managed to regain the crucial $3 trillion mark. Its 24-hour trading volume spiked by 34% to hit $150 billion. The brutal drop earlier this month is seen as one of the worst since the FTX collapse. The sell-off wiped out tens of billions in futures positions and left open interest far below October levels. The Fear and Greed index is still hovering in the “Extreme Fear” zone.

ETF flows tell the same story as worried investors have pulled out more than $3.5 billion from US Bitcoin ETFs over recent weeks. This move reversed what had been one of the strongest inflow stretches since the products launched last year. 

The macro picture isn’t helping as markets are waiting for the Federal Reserve’s next policy signal. Meanwhile, the uncertainty has kept risk assets uneasy. Deutsche Bank analysts last week pointed to a combination of factors behind Bitcoin’s drawdown. They highlighted that a broader risk-off tone as tech valuations wobble.

Hawkish signals from Fed Chair Jerome Powell have stalled progress on crypto legislation in Congress. On the other side, a wave of profit-taking from long-term holders has been a massive part of the collapse.

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